Major Events/Reports:

E.U. economic forecasts

And it revealed that the GDP growth forecast for 2018 was unchanged at 2.1%, but the growth forecast for 2019 was revised lower from 2.0% to 1.9%.

But on a more upbeat note, the projections for 2018 and 2019 HICP were revised higher from 1.7% to 1.8%.

And in his press statement, European Economic Commissioner Pierre Moscovici explained that the downgraded growth forecast for 2019 reflect “Rising global uncertainty, international trade tensions and higher oil prices.”

The upgraded inflation projections, meanwhile, were due to higher oil prices.

Other than that, Moscovici also said that:

“There is a high degree of uncertainty surrounding the forecast and there are many interconnected downside risks.”

Moscovici then specifically mentioned a possible overheating of the U.S. economy, the ongoing trade war between the U.S. and China, Brexit, and “doubts about the quality and sustainability of public finances in highly indebted Member States” as the major downside risks for the Euro Zone economy.

Speaking of “highly indebted Member States,” the European Commission also warned that because of the Italian government’s plans, Italy’s budget deficit is expected to increase by 2.9% in 2019 and then by 3.1% in 2020.

And remember, the Italian government’s deficit target is 2.4% for 2019 and 2020.

Not only that, the European Commission also gave this extensive warning on the outlook for the Italian economy:

“The growth outlook is subject to high uncertainty amid intensified downside risks A prolonged rise in sovereign yields would worsen banks’ funding conditions and further reduce credit supply, while public spending could crowd out private investment. Envisaged policy measures might prove less effective, having a lower impact on growth. Uncertainty about government policies might affect sentiment and domestic demand. Finally, the planned rollback of structural reforms bodes ill for employment and potential growth.”

Every day, I will present to you my findings and daily commentaries on what recently happened in the economic arena, possible shifts in sentiment, economic events to watch out for, and their effects on currencies.

We introduce people to the world of currency trading, and provide educational content to help them learn how to become profitable traders. We're also a community of traders that support each other on our daily trading journey.